Trapwire: It’s Not the Surveillance, It’s the Sleaze

Stratfor executive Fred Burton. Photo: AP

Updated 3:48 p.m.

Ever since WikiLeaks began releasing a series of documents about the surveillance system Trapwire, there’s been a panicked outcry over this supposedly all-seeing, revolutionary spy network. In fact, there are any number of companies that say they comb through video feeds or suspicious activity reports in largely the same way that Trapwire claims to do. What’s truly extraordinary about Trapwire was how it was marketed by the private intelligence firm Stratfor, whose internal e-mails WikiLeaks exposed.

The documents show Stratfor being less than straight with its clients, using temporary jobs in government to set up Trapwire contracts, and calling it all a “wet dream.” In their e-mails, executives at Stratfor may have been hyping up a surveillance technology. But what they really did was provide reconnaissance on the $25 billion world of intelligence-for-hire that’s ordinarily hidden from public view. In this case, the sunlight isn’t particularly flattering.

‘Once Fred is the #2 dude in the Texas Department of Public Safety, he is going get $1,500,000 to install TrapWire.’

On Nov. 4, 2009, Fred Burton, the vice president of the private intelligence firm Stratfor, co-wrote an essay on emerging terrorist threats and the means to stop them. Particularly impressive, Burton wrote, was a new software tool called Trapwire, which works “with camera systems to help detect patterns of preoperational surveillance … to help cut through the fog of noise and activity and draw attention to potential threats.”

The essay was typical of the trend analyses, news summaries, and hot tips that Strator provides every day to its customers in government and in industry. For these services, Burton’s clients pay his firm handsomely; a single Stratfor enterprise license costs more than $20,000 (.pdf). These customers rely on Burton and his team to provide the latest word from flashpoints worldwide — and to explain what this torrent of information all means. They count on Stratfor to help make sense of the world.

What his customers reading that November 2009 essay may not have realized was that Burton was also marketing them a product. On Aug. 17 of that year, Stratfor and Trapwire signed a contract (.pdf) giving Burton’s company an 8 percent referral fee for any business they send Trapwire’s way. The essay was partially a sales pitch — a fact that Burton neglected to mention.

“If I was one of Stratfor’s business clientele or government clientele, I’d be a little alarmed or a little confused or both,” adds Aid, a former executive at the private intelligence firm Kroll Associates. “If you don’t tell the people who are paying for your products caveat emptor [buyer beware] … that’s constructive fraud, to use a legal term.”

Trapwire did not immediately respond to e-mail and telephone inquiries from Danger Room. Stratfor declined to comment.

The pattern repeated itself on Sept. 25, 2010. Burton launched his public blog with a post lauding Trapwire, which was, in his words, “leading the way” in video analytics. “A suspect conducting surveillance of an HVT [high-value target] in one city can … be spotted by TrapWire conducting similar activity in another location, connecting the infamous dots,” he added. “I can also see the tool being very effective in identifying general street crime as well.” Again, clients were not told of Stratfor’s relationship with Trapwire.

And Stratfor did more than promote Trapwire in Burton’s writing, as independent journalist Ben Doernberg discovered as he sifted through the WikLeaked emails. In the late summer of 2009, Fred Burton was appointed as the Texas Department of Public Safety’s assistant director for intelligence. To Stratfor president Don Kuykendall, the convergence of the Trapwire contract and the Burton appointment were a potential gold mine.

“Fred has said that, once he is #2 dude in the Texas DPS (September oneth) that he is going use the appropriated $1,500,000 to install TrapWires [sic] product on the Texas border,” Kuykendall wrote on August 22, 2009. “George, 8% X $1,500,000 = $120,000 for the good guys. Now, this all could be a wet dream, but stranger things have happened.”

Burton only stayed with the Texas DPS a few months. But he and the company continued to use his connections with the department to promote the surveillance system. On Dec. 18, 2009, Strafor executive Patrick Boykin told Burton that the Texas Department of Public Safety would be signing up as a Trapwire customer. In an e-mail entitled “Trapwire and Perry” — an apparent reference to Texas governor Rick Perry — Boykin reported, “I talked with a good friend of mine, Patrick Rose, Texas rep [state representative] for Dripping Springs and he said that come March its [sic] full on again.”

When the Trapwire contract didn’t immediately follow, Burton began tapping his government contacts. On March 30, 2010, for example, Burton reached out to Blake Sawyer of the Texas DPS to see if Trapwire was “on the schedule” to be purchased by the agency. Burton sent a similar note on April 2, a follow-up on May 22, and a fourth note on July 6.

On July 16, Burton reported to his colleagues that “TrapWire for the Great State of Texas is a go. Cash should begin to flow to Abraxas within 10 days. As many of you old-timers know, we arranged to get a cut. I think the first dump is $250,000 to Abraxas, with an annual renewal of $150,000 per year for the TrapWire license. The point man for the project worked directly for me at DPS.”

Especially because, to Strafor, every new Trapwire installation was an opportunity to upsell more products.

“The agencies with TW are potentially the single biggest captive audience we have that could purchase something from us especially in the govt arena. Do you know how much a Lockheed Martin would pay to have their logo/feed into the USSS CP? MI5? RCMP? LAPD CT? NYPD CT?” Burton asked, using the acronyms for the U.S. Secret Service, the British security service MI5, the Royal Canadian Mounted Police, and the counterterrorism divisions of the Los Angeles and New York Police Departments. “Its [sic] unbelievable access. Either we handle this one right, or we’ll fall flat on our faces.”

A May 31, 2009 e-mail from Kuykendall illustrates other ways that the company looked to turn its connections into cash. The message describes a set of potential contracts in Mexico for the Dutch chemical concern LyondellBasell.

One – a $28,000 “easy” one and another … to determine the effort and $$$$$$$$$ from me after getting the info. Also out there with LyondellBasell is a biggie we priced at $300,000 which is centered around Fred [Burton]’s cashing in some chits in Mexico. This has nothing to do with time spent – it’s all about introductions to the right people which is VALUE to LyondellBasell. This is “easy money” and therefore has low probability of getting done. LyondellBasell is loosing [sic] between $1,500,000 and $5,000,000 / year on the local Mexicans skimming production from one of their plants in Mexico. I’m not counting on this. The company is taking our proposal to their Board next week.

In 2009, most of Abraxas was sold off to the defense contractor Cubic Corporation. Trapwire was not included in the deal; it hadn’t generated the revenue that executives had expected when the product was first launched. On Monday, Cubic took the unusual step of issuing a press release stating that it has “no affiliation” with the surveillance firm. If only everyone in this sordid story was so clear about their corporate connections.